Keynesian Economics and the Great Depression

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Documentary on Keynesian Economics and the Great Depression.
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25 Responses to “Keynesian Economics and the Great Depression”

  1. Evan Kant

    The root problem of our system has been explained by theoreticians such as
    Sismondi and Thompson in the past. It is underconsumption. Keynes
    emphasises the need for government spending so as to boost income for the
    middle and lower classes and through the multiplier of consumption to
    regenerate economic motion. The economy is a process of countless
    individual decisions, however, an economy that lacks spending in grass
    roots level eventually is led to sclerosis.?

  2. IFloridaMotocrossI

    Agreed. Partisanship and stupidity are much more potent and prevalent
    forces than receptiveness.

  3. catallaxy

    This video is incomplete. The graph you show starts in 1929 but, the cause
    of the Great Depression was really the Federal Reserve printing large
    quantities of money to finance the First World War, around 1913. This
    inflation of the money supply created the financial bubble that burst
    later, in 1929. FDR prolonged the Depression with his socialist policies.

  4. Salvador N Sahagun

    @losheva Their is inflation because we are pumping money into demand and
    all of (I) is going to speculation

  5. Salvador N Sahagun

    @losheva Then I cut wages to pay for the losses?

  6. Dawgmandede

    Yea. Unfortunately, that idea would never fly. Forevermore will politicians
    argue about the validity of one system vs. another. And unfortunately they
    will always fall back on old systems. Innovation has become a thing of the
    past in today’s society!

  7. losheva

    @Salvysahagun there’s debt and debt, example public debt must be
    anti-cyclical as Keynes said, to avoid bubbles and recessions, then if his
    words were misinterpreted it’s not his fault, but when debt is “private”,
    debt gets out of control. I understand that you’re a “Austrian”, but as
    Marxism, this school is utopian ideology, real world is
    different.P.s.Malthus studied economic cycles when Fed didn’t exist.
    Austrian theory is one theory, and wrong for me, confuses cause and effect

  8. BelieversinThings

    @gulbirk The most succesful countries lean much further toward capitalism
    than socialism. America is doing better than Europe because we have freer
    markets. The reason why China suddenly became a competetive country in is
    because they started adopting capitalism. The living conditions in
    capitalist leaning countries are far better than socialist leaning
    countries. You have no idea what the facts are.

  9. Hook242002

    @kitycalifornia …and Smith was wrong about a lot of things in Wealth of
    Nations. Keynes just continued the error.

  10. losheva

    @Salvysahagun so for you in case of depression, therefore in case of lack
    of demand it’s a good thing cut wages? so as to suppress consumption
    therefore suppress demand again? sage

  11. Cyril Moses

    @jessemaurais Bubbles are proportional to the value of the dollar. Once
    there is an increase in money supply by means of easy lending practices or
    excessive printing of money (Fiat) going after the same amount of goods,
    causes artifiacial inflation. Which leads to the devaluation of a currency.
    The same factors that brought about the Great Depression are the same
    factors that brought about the recent Recession. As more money became
    available speculation increased its just simple economics.

  12. losheva

    @Salvysahagun a) if there was a lake of demand there wouldn’t be a
    recession (in the U.S. first in Europe now) b) if it were enough to
    increase the money supply to push the demand, well then it means you did
    not ever read Keynes and it seems pointless to continue the discussion.

  13. Beckett125

    That was the point of the AAA. In fact, there is no difference between
    Hoover’s policies and FDR policies. FDR had made campaign promises to put
    the fiscal house in order instead of spending and increasing the public
    debt. “I cannot see a way to continue the spending, it does not work” –
    Henry Morgenthau, Jr. 52nd Treasury Secretary of the United States, chief
    architect of the New Deal

  14. losheva

    @Salvysahagun when you say that there is a lack of money, plus, you
    contradict yourself, assuming that ruled M. Friedman, how can there be
    inflation with shortages of money, if inflation is a purely monetary
    phenomenon? there is inflation when money supply is higher than money
    demand.

  15. losheva

    @Salvysahagun The Bank was privately owned and operated from its foundation
    in 1694. It was subordinated to the Treasury after 1931 in making policy
    and was nationalised in 1946. Who is the ignorant?

  16. Michael Runow

    @spec24 Money changing hands is what makes an economy work. If everyone
    just put their money into their mattresses and stayed home, there would be
    no economy.

  17. IFloridaMotocrossI

    Nah, I think Keynes was more of a Fascist than a “Economist of Keynes”.
    Hitler was the only true dictator to fully utilize the great anti-semitic
    economic principles of Keynes. Roosevelt was more of a Conservative…

  18. puttincomputers

    @Dawgmandede what was the purpose?

  19. PrinceMyshkin22

    its way back up. Fortunately we had FDR, a man who felt that to allow that
    to happen was unnecessary and inhumane! One will notice that after we
    abandoned the Gold Prison Cage Standard in 1933 and implemented
    infrastructural stimulus the economy began to bounce back. With the
    enactment of Glass-Stegall in 1933, the FDIC was created so as to prevent
    people from losing their savings to unnecessary bank runs.

  20. MrMrmike5

    I love it how 2 people claped after he finished his redistribution bit…

  21. David Yates

    I’m sure this has been mentioned already, but nevertheless, the
    implementation of Keynesian economics didn’t work during the Great
    Depression (how can it possibly be said that such a program worked when,
    more than a decade later, the economy still hadn’t improved yet?), nor is
    it working now. In fact, it’s just making things far, far worse. And, I’m
    sorry, but the narrator sounds too much like Paul Krugman when he excuses
    its lack of success by claiming that it simply wasn’t implemented enough.

  22. Salvador N Sahagun

    @losheva Not an Austrian you ignorant turd see my first comment.

  23. Jeff Cole

    Violence is most certainly used to raise tax revenue. Why would people pay
    if they were not afraid of men with guns coming to lock them up if they
    refuse?

  24. StAugustine79

    False! World War II got the united states out of the Great Depression.
    FDR’s New Deal inflated the financial bubble and there had to be a bounce
    back after the war to make up for the draft that affected other sectors of
    the economy. Keynesian economics has been a total failure. It has
    systemically led to increased debt due to artificially low interest rates,
    increased spending, inflation, and mal-investment. The Austrian school was
    and is correct.

  25. spec24

    So the gov’t taking money out of the economy and then putting it back in
    the economy is the answer? Genius Keynsians.. just brilliant.