/biz/ - Business & Finance

it's a big meme. Lucas is right, econometrics confirm. All we can do is trying to control inflation and industrial planning. No more.
There are so many false premises, or, to be more specific, more premises that dont work anymore. As Lucas says, economics as a science changes the economic system... so, for example, the consumption theory of Keynes doesnt work anymore because thinking that way isnt optimal anymore given the knowledge of other intermediaries.
t. i know what i'm talking about (MSc)

>>15988733
DUBS btw it isn't true, you learn Keynes only in the first part of the first course of macroeconomics and in history of economic theories. In the same economic theories course i've learnt the limits of his theory and the same is for macroeconomics (and obv more recent theories).

btw OP i can try to simplify to you and desu it's just politicians, bc in economics there's no "good" if not perfect competition (and someone could tell you this is fake too, but only a few).
Basically there are two motives:
1) Deflation is generally bad, and it's so bad that we needed to fix inflation as an objective (at least here in Europe). Why? A lot of reasons, but the strongest is that it would incentivize individuals to save money to get better trades in the future , and that would start a downward spiral for production and occupation. It kills innovation too and a lot of other things, but this is too long to explain on /biz/.
2) You can lower interest rates and stimulate aggregate demand in the short run. If central bank buys and prints money you expect agents to spend theirs in titles or to offer more to eventual debtors, lowering interest rates and increasing Investments, occupation and production in the short run. Sometimes it works, that's it, but it doesn't work as often as many boomers think…(too long to explain) and it's a shit long run move, sooo… probably Trump wants the Fed to print more money just to flex that +0,5% GDP growth and then shit on the next democrat president when the economy will rebalance.

t. finance student in top university passing by, i usually post on [s4s].