logo
episode-header-image
Oct 2024
36m 31s

The cycles of the economy

Steve Keen & Phil Dobbie
About this episode

What causes an economy to fall from a peak? Many economists will argue it’s exogenous shocks but, as Phil and Steve discuss, there’s not too many of those around. Maybe COVID was one, but even that came about because our economic system has drawn us closer to wildlife habitats.


Or is it a lack of resources? We run out of capacity to produce more, whether it’s factories, people or natural resources, like fossil fuels. Does the shortage relative to demand force prices up and its inflation that ultimately kills growth.


No, says Steve. Karl Marx had it right when he postulated that the rising pressure on wages will cut the profit that capitalists thought they would be earning, which would mean they cut investment. Talk about cutting off your nose to spite your face.


So, if that’s how economies peak, what is it that pulls hem out of a trough? And is there anything we can do to minimise the impact of business cycles, or are they simply the natural order of things?


Hosted on Acast. See acast.com/privacy for more information.

Up next
Nov 19
Oh Canada!
<p>Several listeners have written in to get Steve’s views on the path being taken by Mark Carney to rescue the Canadian economy. Initially it looked like the country was rebounding strongly from the pandemic, but in the last couple of years the growth has slowed and then declined ... Show More
46m 45s
Nov 12
Wages, jobs and inflation
This week Phil and Steve look at cost-plus inflation, driven by rising wages. Right now its being given as the reason that services inflation is remaining sticky and that’s why many central banks are reluctant to reduce interest rates. Steve says it’s a far more sensible assumpti ... Show More
45m 10s
Nov 6
Narrow economies vs broad economies
Is it fair enough to totally write off Ricardo’s theory of competitive advantage? Certainly, President Trump isn’t an advocate, using tariffs to protect America’s domestic industries from those countries that produce stuff cheaper. A broad economy, producing a range of products a ... Show More
47m 18s
Recommended Episodes
Dec 2024
Will the end of economic growth come by design — or disaster? | Gaya Herrington
<p>What if solving poverty, caring for nature and fostering well-being were the ultimate goals of the economy, instead of growth for its own sake? Environmentalist and economist Gaya Herrington proposes a shift in thinking from "never enough" to "enough for each," asking us to co ... Show More
14m 48s
May 2025
Is This the Recession the US Needs to Have?
The world faces a staggering $315 trillion debt crisis—three times global GDP! Are we on the verge of economic collapse with 10% of production going to interest payments? From meme coins exceeding major car manufacturers' values to escalating trade threats and actual wars, could ... Show More
15m 8s
Jun 2025
More on Repealing the Laws of Economics
In his latest memo, Howard Marks discusses the implications of governmental intervention in economies. Considering examples such as rent control, fire insurance, and tariffs, he emphasizes that while free markets don’t produce perfect solutions, efforts to control them often make ... Show More
39m 39s
Oct 2024
Will the end of economic growth come by design — or disaster? | Gaya Herrington
<p>What if solving poverty, caring for nature and fostering well-being were the ultimate goals of the economy, instead of growth for its own sake? Environmentalist and economist Gaya Herrington proposes a shift in thinking from "never enough" to "enough for each," asking us to co ... Show More
13m 23s
Mar 2025
The Truth about Tariffs: The Ultimate Guide to Busting Inflation Myths
<p><strong>Notes from James:</strong></p> <p>I’ve been seeing a ton of misinformation lately about tariffs and inflation, so I had to set the record straight. People assume tariffs drive prices up across the board, but that’s just not how economics works. Inflation happens when m ... Show More
25m 27s
Nov 13
How climate shocks could break the economy | Edmond Rhys Jones
Climate change isn't just reshaping our planet — it's also shaking the very foundations of the economy, says sustainability expert Edmond Rhys Jones. He explores the massive gap between what science tells us about the climate crisis and how the economy measures its impact, advoca ... Show More
12m 59s
Feb 2024
Can capitalism save the climate
Worried about your carbon emissions? Don’t stress! You can pump out as much as you want - as long as you buy some offsets to balance it out. Scared of the collapse of wildlife? No problem! We can figure out how much money our ecosystems are worth, and let the market do the rest! ... Show More
45m 49s
Apr 2025
Tariffs Could Drag on Growth in Asia as Well as U.S.
<p>Our U.S. and Asia economists Michael Gapen and Chetan Ahya discuss how tariff uncertainty is shaping their expectations for these economies over the second half of 2025.</p><p><br></p><p>Read more&nbsp;<a href="https://www.morganstanley.com/ideas?cid=mg-SM_CORP-insights-17607" ... Show More
11m 19s
Feb 2021
Episode 91, 'How to Save the World from Financialisation' with Grace Blakeley (Part II - A Green Future, Further Analysis and Discussion)
<p class="">'History has ended, and capitalism is the last man standing. The innovations and freedoms enjoyed by the Global North have shown that the free market is the only viable economic system; it is almost impossible to imagine a coherent alternative.'</p> <p class="">This w ... Show More
26m 59s