Keynesian economics vs. Austrian economics

[RVtitem]

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There are two kinds of economists in the Western world - Keynesian and Austrian.  Almost exclusively, what is taught in American universities is Keynesianism - and virtually all the economists at the Federal Reserve, America's central bank, are Keynesians.  In fact, pretty much every economist in the Western world is a Keynesian these days and the Austrian economists lead a very fringe existence.
The Keynesians are called that because the crux of their theory came from John Maynard Keynes, a British economist of the early 20th century.  The Austrians are called that because their theory came from some Austrian economists who were active in Austria pre-W.W.II, but were Jews, and were smart enough (like Einstein in Germany) to get out of Austria before it was annexed by Hitler.  They went to America and that is where they came to be known as "Austrian economists" (because to the Americans, it was more important that they were from Austria than that they were Jews).  Their version of economics has been called Austrian economics ever since - but the reality is that it took them a while to get established at all in America (in other words, to get to the point where they got their academic qualifications accepted here and were allowed to teach at university) and by the time that happened (and, probably, even long before), the Keynesians were so well-entrenched in America that the Austrians have never really been able to compete against them for notice.  Consequently, they have always been very much on the fringe (so far - I think that will change soon when their big-picture predictions come true in a big way and the modern Keynesians are proven dead-wrong in the big picture by actual circumstances).
The most basic lesson associated with Austrian economics is that economies go in cycles - and that is a fact (explained elsewhere on this website), but not one that modern Keynesian economists want to acknowledge.  Modern Keynesians just want to avoid recessions at all costs.  And that is what they have been doing ever since they could actually start doing so in the 1980's.  The problem is that the cycles don't go away in the process -they just get postponed(explanation elsewhere on this website).  So, when the Keynesian economists refused to let the economy go down after the 1987 stock market crash and throughout the 1990's, the system compensated in the only way it could - by letting the stock market go sky-high.  That was viewed by most people as a very good thing - but it was actually a very bad thing (brief explanation next in this paragraph).  Since the authorities kept supporting the economy, the pushing eventually resulted in the stock market going exponential - in the late 1990's, as it happened.  Exponentials ALWAYS end badly (NO exceptions) - and so I expected both the stock market and the economy to go down hard in the early 2000's.  The stock market did (although most people can probably hardly remember that anymore) - but the economy did not.  It was when I was in the process of trying to find out, in the summer of 2001, why the Federal Reserve was fighting the economic downturn so thoroughly that it was doing so even in the wake of a big stock market exponential (the one that happened in the late 1990's), that I found out about the law against recessions (which is essentially modern Keynesianism enshrined in law).  As soon as I found out about that law, I knew immediately (on the basis of what I had already learned before) that if the Fed saved the economy in the early 2000's - which it did - there would just aboutguaranteedbe a BIG economic downturn along with a big stock market downturn sometime between 2007-2010.  As it turned out, the downturn came just about in the middle of my anticipated time-frame (I can indeed beveryconfidentin my big-picture predictions now that I know about the law against recessions!).

www.befinancialcycleseducated.com/index.php/keynesian-economics-vs-austrian-economics

[Kim Jong-Un's Pajama Pants]

Interesting.  It looks like economics is one of those fields where confirmation bias has some sway.  So where does trickle down economics fall?  What kind of economist is someone like David Ndii?

[veritas]

I took a couple economic subjects in my arts degree. Economics/actuarial etc courses today is just math/science. It attracts the best minds. Modern day geniuses today aren't scientists/academics/physicists etc. they're economists/stockbrokers etc.

The most intellectual conversations I've had in my life have been with economists, the way they think and theorize about the universe make scientists/physicists seem like kids/sci fi dreamers/mere poets/writers- educators/ a waste of resources.

The brightest minds in my generation are economists. The world is their oyster, they're the scientists/mathematicians that shape the world. I can assure you they've advanced far more than Keynesian which from my memory is considered outdated than Marxism.

[Kim Jong-Un's Pajama Pants]

I took a couple economic subjects in my arts degree. Economics/actuarial etc courses today is just math/science. It attracts the best minds. Modern day geniuses today aren't scientists/academics/physicists etc. they're economists/stockbrokers etc.

The most intellectual conversations I've had in my life have been with economists, the way they think and theorize about the universe make scientists/physicists seem like kids/sci fi dreamers/mere poets/writers- educators/ a waste of resources.

The brightest minds in my generation are economists. The world is their oyster, they're the scientists/mathematicians that shape the world. I can assure you they've advanced far more than Keynesian which from my memory is considered outdated than Marxism.

Then what is the current dominant view?  Among these brilliant latter day geniuses.

[veritas]

they calculate risks, make predictions, make or break nations/civilisations. for instance actuary studies is one branch of calculating risks in economics.

country-specific; however, almost all processes share a rigorous schooling or examination structure and take many years to complete (Feldblum 2001, p. 6, Institute and Faculty of Actuaries 2014). ...

Actuaries use skills primarily in mathematics, particularly calculus-based probability and mathematical statistics, but also economics, computer science, finance, and business. For this reason, actuaries are essential to the insurance and reinsurance industries, either as staff employees or as consultants; to other businesses, including sponsors of pension plans; and to government agencies such as the Government Actuary's Department in the United Kingdom or the Social Security Administration in the United States of America. Actuaries assemble and analyze data to estimate the probability and likely cost of the occurrence of an event such as death, sickness, injury, disability, or loss of property. Actuaries also address financial questions, including those involving the level of pension contributions required to produce a certain retirement income and the way in which a company should invest resources to maximize its return on investments in light of potential risk. Using their broad knowledge, actuaries help design and price insurance policies, pension plans, and other financial strategies in a manner that will help ensure that the plans are maintained on a sound financial basis (Bureau of Labor Statistics 2015, Government Actuary's Department 2015).

https://en.wikipedia.org/wiki/Actuary

Without their theories in practice applied to things like insurance, we'd be all poor due to no insurance, trade, IMF, export/import, stock market, companies, these people make the world work or not. They also have cutthroat insights into human beh. for instance market research is an area of economics. The kind of scientific market research results obtained is the reason why they can brainwash the masses. 

Only recently like in the last decade or so is the field of medicine starting to adopt economic principles. Things like clinical trials, preregistrations, cost-benefit analysis, decision-analysis, evidence-based (statistical/bayes) medicine are derived from economic principles. My friend was calculating risks using bayesian principles in first year macroeconomics or something twenty years ago, she talked to me about it and I remember the only thing I was thinking about as a sordid neuroscience major was raiding her college oven for chicken wings.. whereas in fields like medicine, only in the last decade or so these stupid-ass doctors are starting to understand why scientific prediction tools have better outcomes for patients. I studied with doctors and they struggled to wrap these concepts/make calculations/assess decisions around their rote-learnt mofo minds, whereas I find mathlete brainiacs who tend to study economics have no problem with it.

And as years go, these doctors become like plumbers who can memorize big words, marginalize some patients whatever, hands systematically grope and ignore patients, with nothing up there dumber and dumber, sort of like scientists who get better at mincing words, mince formulas, collaborate with 101 juniors who do their work for them, dabble scifi headlines for publication fame fortune, make a name, metric, H-impact whatever, whereas I find economists take on the responsibilities of making the world work.