{"id":59751,"date":"2021-10-08T13:20:44","date_gmt":"2021-10-08T18:20:44","guid":{"rendered":"https:\/\/olduvai.ca\/?p=59751"},"modified":"2021-10-08T13:20:44","modified_gmt":"2021-10-08T18:20:44","slug":"economic-theory-and-long-wave-cycles","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=59751","title":{"rendered":"Economic Theory and Long-Wave Cycles"},"content":{"rendered":"
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ECONOMIC THEORY AND LONG-WAVE CYCLES<\/a><\/h3>\n<\/div>\n<\/header>\n
Investors and others are confused by the early stages of accelerating price inflation. One misleading belief is in cycles of industrial production, such as Kondratieff\u2019s waves. The Kondratieff cycle began to emerge in financial commentaries during the inflationary 1970s, along with other wacky theories. We should reject them as an explanation for rising prices today.<\/strong><\/div>\n
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This article explains why the only cycle that matters is of bank credit, from which all other cyclical observations should be made. But that is not enough, because on their own cycles of bank credit do not destroy currencies \u2014 that is the consequence of central bank policies and the expansion of base money.<\/strong><\/p>\n

The relationship between base money and changes in a currency\u2019s purchasing power is not mechanical. It merely sets the scene. What matters is widespread public perceptions of how much spending liquidity is personally needed. It is by altering the ratio of currency-to-hand to anticipated needs that purchasing power is radically altered, and in the earliest stages of a hyperinflation of prices it leads to imbalances between supply and demand, resulting in the panic buying for essentials becoming evident today.<\/strong><\/p>\n

Panics over energy and other necessities are only the start of it. Unless it is checked by halting the expansion of currency and credit, current dislocations will slide rapidly into a wider flight from currency into real goods \u2014 a crack-up boom.<\/strong><\/p>\n

Introduction<\/strong><\/p>\n

For eighteen months, the world has seen a boom in commodity prices, which has inevitably led to speculation about a new Kondratieff, or K-wave. Google it, and we see it described as a long cycle of economic activity in capitalist economies lasting 40\u201460 years. It marks periods of evolution and correction driven by technological innovation.[i]<\/a><\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

ECONOMIC THEORY AND LONG-WAVE CYCLES Investors and others are confused by the early stages of accelerating price inflation. One misleading belief is in cycles of industrial production, such as Kondratieff\u2019s waves. The Kondratieff cycle began to emerge in financial commentaries during the inflationary 1970s, along with other wacky theories. We should reject them as an […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[7772,7380,31921,31920],"class_list":["post-59751","post","type-post","status-publish","format-standard","hentry","category-economics","tag-alasdair-macleod","tag-cobden-centre","tag-kondratieff-wave-theory","tag-long-wave-cycles"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/59751","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=59751"}],"version-history":[{"count":0,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/59751\/revisions"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=59751"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=59751"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=59751"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}