Keynes Quotes

“If only one person were perfectly informed there could never be a general crisis. But the only perfectly informed person is God, and he does not play the stock market.”
― Robert Skidelsky, Keynes: The Return of the Master

“MACROECONOMIC POLICY In the orthodox economic theory of Keynes’s day, the notion of a saving glut made no sense. Saving and investment were continually adjusted to each other by changes in the term structure of interest rates. Any tendency for saving to run ahead of investment would lead to a fall in the interest rate, which would simultaneously reduce the propensity to save and increase the inducement to invest. But in Keynes’s theory, the interest rate did not play this adjusting role. Determined by people’s liquidity preferences, it could remain higher than needed to equalize saving and investment at full employment. The equalization between the two was therefore achieved by a fall in income,”
― Robert Skidelsky, Keynes: The Return of the Master

“there is no single Keynesian way out of depression, so there is no single Keynesian system of political economy. Keynesianism can at best be a common element in very different systems of mixed economic life. In terms of economic policy it has only one proposition: that governments should make sure that aggregate demand is sufficient to maintain a full-employment level of activity. By what mix of politics, policy and institutional innovation this is to be done is a political-economy question. One thing of which we can be tolerably sure is that the next phase of political economy will see less reliance on export-led growth, a more restricted financial system, an expanded public sector, and a more modest role for economics as tutor of governments.”
― Robert Skidelsky, Keynes: The Return of the Master

“notably the 1999 repeal of the US Glass–Steagall Act – allowed commercial banks to become investment banks as well. In addition to investing their depositors’ money, they became highly leveraged speculators in the newly developed securities,”
― Robert Skidelsky, Keynes: The Return of the Master

“Kanjorski claims to be repeating an account of events given to him by US Treasury Secretary Henry Paulson and Fed Reserve chairman Ben Bernanke: On Thursday [18 September], at 11 a.m. the Federal Reserve noticed a tremendous draw-down of money-market accounts in the US; [money] to the tune of $550 billion was being drawn out in the matter of an hour or two. The Treasury opened up its window to help and pumped a $105 billion in the system and quickly realized that they could not stem the tide. We were having an electronic run on the banks. They decided to close the operation, close down the money accounts and announce a guarantee of $250,000 per account so there wouldn’t be further panic out there. If they had not done that, their estimation is that by 2 p.m. that afternoon $5.5 trillion would have been drawn out of the money-market system of the US; [this] would have collapsed the entire economy of the US, and within 24 hours the world economy would have collapsed. It would have been the end of our economic system and our political system as we know it.10”
― Robert Skidelsky, Keynes: The Return of the Master

“The securitization of mortgages was not new; its explosion after 2000 was the result of three deregulating policy decisions: the repeal in 1999 of America’s Glass–Steagall Act of 1933,”
― Robert Skidelsky, Keynes: The Return of the Master

“By the end of 2007, UK household debt had reached 177% of disposable income, mortgage debt 132%. Martin Wolf wrote in the Financial Times in September 2008”
― Robert Skidelsky, Keynes: The Return of the Master