Tuesday, August 28, 2007

Convergence of their Theories based upon the Long Wave Hypothesis

Smith, Marx, Kondratieff and Keynes

Written in 1998, this paper looks at the works of 4 economists (Smith, Marx, Kondratieff and Keynes) with respect to long-wave theories.

The article is clearly dated by viewing the internet as "a new business paradigm" which the bursting of the dot-com bubble proved incorrect.

The author clearly thought that another debt-level expansion was not possible as debt levels were at saturation limits back then. He did not foresee US IR going to 1% allowing another surge of debt levels to 360pc of GDP.

The worrying aspect is that even if we do have a depression, there is no labour-based innovation that will lead us to the next upswing in the long-wave cycle

The coming depression will last until this labour-based innovation can be discovered and implemented.

Posted by sold 2 rent 1 @ 08:10 AM (1134 views)
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14 thoughts on “Convergence of their Theories based upon the Long Wave Hypothesis

  • This is precisely why I believe these events to have been deliberately contrived by governments and globalist companies.

    If this were to be the case – could it be constured as being an act of treason againt the people of the United Kingdom?

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  • “there is no labour-based innovation that will lead us to the next upswing”

    This is something that I clocked several years back – that the pace of technological advancement is slowing.

    New technologies take around a decade to become fully assimilated into daily life – thus it is that the practical uses of the internet are not yet fully exploited.

    But looking at core – emerging technologies that will influence daily life in the years to come, it is apparent that the only major advancements are in the medical field, and to a lesser extent, the entertainment field.

    New technologies that enable people to do more in less time have been noticeably absent since the turn of the millennium.

    This, together with concerns over the environment and the inevitable end of absurdly cheap imports of manufactured goods, leads me to believe that the developed world will have to get used to the notion of zero growth (per capita) as the economic norm.

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  • planning4acrash says:

    Oh yes there is. The next revolution will have to be the sustainability revolution. There is an extreme potential for efficiency. Billions of lightbulbs to replace, millions of SUV’s to become hybrids, millions of homes to insulate, squillion neighbourhoods to be converted to combined heat and power, many more people could become vegetarians (1 acre of land will sustain probably, and this is not accurate, 6x as many vegetarians as it will meat eaters, because you have to feed livestock with food that would have fed the vegetarian directly), a solar heater on the roof of every house for hot water to cut bills by 1/3, appliances all to be converted to the maxiumum efficiency. Public transport, bio-diesel from farming, restaraunt waste products. Recycling and reuse, Unfortunately we will be running to catch up with peak oil, but I think that America alone could cut its oil consumption by a quarter by going for efficient cars, a transition that could take a decade, given that most people get a new car once a decade.

    Also, and I know that renewable energy aint quite as good as it is said to be, but local energy production may well shift some wealth away from oil producers. They may for example be some growth and profit to be made from unwinding globalisation, or, globalisation reaching a new phase, where developing countries become consumers. A crash may result in that by inflating Chinese currency for example (loosing the dollar peg) if it becomes unsustainable, like when the UK was forced out of the ERM, meaning that our manufacturing picks up again as we feed the Chinese and others with hi-tec goods.

    So, that’s two things, a shift in trade if a crash levels out currencies, which will be a natural consequence that won’t have to be planned, people just follow the trend. Plus an active drive to sustainability, which is a bit less likely given that it requires political intervention, but, sustainability is growing and it could become self-reinforcing once economies of scale are reached and consumers have more need to be efficient as resources dwindle.

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  • planning4 all these changes you describe are the result of innovation failure, we’ve harnessed the power of the sun with nuclear power but everytime the government try’s to build a power station environmentalists try to stop them. Peak oil is a problem because we haven’t developed cars that can run on a thimble of petrol. Mankind will only move forward as long as it innovates once we stop innovating we will move backwards towards a new darkage. If environmentalists had been around at the time of the industrial revolution it would never have got off the ground and we’d still be plowing fields with horses.

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  • I believe that the current flawed model of capitalism has stifled real innovation in favour of profit-making. How much has the car, for example, moved on? Houses are built using the same techniques and materials as a century ago. In most areas other than a few such as medicine, the focus is on style over substance – making something ‘cool’ means a higher price can be charged and innovation is unnecessary.
    As far as mankind ‘moving on’ is concerned, if it wasn’t for environmental concerns, we’d have passed ‘peak oil’ a long time ago and be heading for ‘zero oil’. Imagining that industrial society would have regulated itself in any way is naive in the extreme – the bottom line is this year’s profit margin and that’s it – 20 years down the line is for someone else to worry about.

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  • “moving forward” to where exactly? An 80 ft yacht for everybody? The only thing most people need (or indeed really want) is a modest amount of food, clothing, shelter/home, reasonable health and leisure time/activities. Would life really be so bad without an 80gb ipod, a camera fone and a 2 week holiday in wherever? As for alternative local heat/power – I’ve researched them and they’re a waste of time/money. Several standard cars will now do 70mpg. Oil consumption could be slashed tomorrow if governments mandated it. Meat consumption is over-rated – rising prices should do for that for most people. I barely eat meat due to price. The solutions mostly don’t require technology, just political will and an acceptance that “growth” doesn’t mean much.

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  • sold 2 rent 1 says:

    The capitalist model is based on growth. Growth of population, growth of sales, growth of profits, and growth of market share. This current model can only survive by colonising new planets which may be 100-200 years away.

    At some point in the future, planet earth will need to have a zero-growth policy where the population remains stable and we live in a 100% sustainable environment.

    We need to innovate fast to take us to this new paradigm.

    The previous debt cycle (1830-1933 peak to peak) lasted 100 years as the growth was fuelled mainly through innovation. This debt cycle (1933-present) has been much shorter because almost all of the growth has been debt-fuelled with little innovation.

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  • Economic growth ultimately comes down to getting more for less effort – changing lightbulbs doesn’t achieve that

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  • Red Kharma the natural “move forward” is in to outerspace to discover other worlds and possibilities, the energy available to us in the universe is limitless. Western civilization however currently lacks the confidence and drive to achieve this so don’t expect to be commuting to Mars each day any time soon.

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  • Don’t worry mrmickey, I expend more than enough energy trying to avoid commuting to manchester. Mars can wait.

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  • Aye, mrmickey, for the rich after this planet is trashed. How we can be proud of this ‘moving on’.

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  • Shipbuilder I rest my case

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  • fahrenheit451 says:

    @ mrmickey
    Ah the next property hotspot, Luna City near Lake Tranquility, but I heard that plots of land there are already for sale.
    http://me.moonestates.com/moon.php

    & also P4C
    If I threw my “Sabo” into the cogs of the Mechanical Revolution, I was called a Saboteur, now I be a member of Greenpeace.

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  • In my opinion, energy consumption per capita is the most reliable measure of national prosperity. Clearly energy consumption cannot increase exponentially, so to maintain our current living standards, we would either have to find a way of harnessing energy created by nuclear fusion, or we would have to reduce the rate of population growth. Improvements in energy efficiency (home insulation etc.) don’t tend to be effective in this respect, because any savings are normally just reallocated to something else which ultimately also requires energy in its production.

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