John Maynard Keynes. As long as other banks are also over extending themselves it will eventually come back to these banks and make up for the difference. When the prices drop to affordable levels, consumers will buy the goods again and the economy will be stable. The rate of interest is a very important aspect of the investing process and one that should never be over looked. In his most well known writings, The General Theory of Employment, Interest, and Money, which was published in 1936, Keynes worked to break down the prior ideas of traditional economics and point out its inadequacies, which became obvious during the downturn of the economy. John Maynard Keynes (June 5, 1883-April 21, 1946) has dissertation proposal defense youtube been widely acclaimed as one of the greatest economists of the twentieth century.
Essay about john maynard keynes
The bank gets the bond, while the reserve is given the money, which reduces the money that the bank has available to lend out. Lowering taxes can cause a budget deficit, but Keynes would argue that deficits are vital and not an economic problem. Not only does the rate of interest break the propensity to hoard and offers them piece of mind to part with said money, but also in the end is what ultimately increases the value of ones investments. These forms of liquid money bring the investor a sense of security and control over their assets something that will comfort them in times of uncertainty. Also, if ones income is small enough that they usually end up spending the majority of their income every month, if they receive an increase in income they will most likely have a much higher propensity to spend then that of someone who has. This process repeats over time and eventually bank one will reap the benefits of having originally overextending itself to the person seeking the loan because that money will eventually make its way right back to bank one and allow for this process to continue. Indicator for how their investments will behave today nor can one look to present conditions and make an accurate prediction for how their investments will behave tomorrow, there is no reliable way to calculate how the market will treat you and your investments.