Hyman Minsky's theories and ideas are seeing a revival post the events of last year. I have previously read Manias, Panics and Crashes by Charles Kindleberger, which used Minsky's three-part taxonomy to describe various financial panics of the last few centuries. Now, I picked up one of Minsky's own book Stabilizing an Unstable Economy. As this is a fairly detailed and complex work, I think the best way to maximize efficiency is to take notes. So, I will be posting notes from various chapters going forward.
This book was written in 1986, so it deals extensively with the 1966 - 1982 era: the time frame went Dow Jones gave exactly 0% return. Sounds familiar. In particular, in Chapter 2, there is a very counter-intutive proposition. Corporate profits might increase during a recession, depending on how government deficits move. This is what happened in 1975. That is probably why stocks turn up before economy does - as is often said.
I need to understand this better, as this will lay waste to all the bear theories. Govt intervention work, even if they are inefficient, because they are massive.
Their will always be instability in economies.
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