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Gilligan

"DSK" wrote in message
...
Pay the debt with inflated currency.

When the debt is one of the drivers of inflation, how is inflation going
to oustrip debt? Isn't this like putting the cart before the horse?

Gilligan wrote:
Germany in the 1920's. Simply turn on the printing presses and devalue
the currency.

Good example. Did it work out in the end?

This thread got side tracked somehow. What I started out to say, for 1
ASA/economist point, can anybody answer what economic theory did
Friedman produce? 2 points if you can explain it.

Gilligan wrote:
I don't think he produced any new economic theory but rather contributed
deeper understanding and refinement to old ones.

DSK wrote:
AFAIK he definitely invented something new, but five or six minutes of
googling has failed to produce a reference to it, unless you already know
the specific term.

Gilligan wrote:
Don't you know it?

Yes: velocity

Friedman's work was key in measuring various inputs to the money supply,
quantifying the trend in velocity, and stabilizing inflation.

http://www.mises.org/story/918

He didn't come up with any new theories. He refined old ones.

Actually, I thought he did, but with further research (more than I really
have time for today) I'm beginning to think you're right.

... Have you ever read "Human Action" by Ludwig von Mises?

No have you?

Yes

.... He was a founder of the Austrian school of economics, a predecessor
of the Chicago school which laid a good deal of the ground work.

http://en.wikipedia.org/wiki/Ludwig_von_Mises

Never heard of the man before now. Looks like pretty interesting stuff,
thanks for the reference.

Just to make sure, I went back to my old textbook, which does indeed say
that Milton Friedman invented the concept of velocity, as applied to
quantifying the money supply. However, after digging around quite a lot
(interesting reading but I have a lot of other things that I should be
doing instead right now), I don't think he did invent the concept of
velocity.

http://www.unc.edu/depts/econ/byrns_...les/fisher.htm

In any event, Friedman was the first to reliably use numbers from the real
world to show how the money supply related to changes in GNP, employment,
and inflation, which is something that economists had pretty much given up
on.

Dr. Friedman's work... and economic history since... has been the basis of
relatively stable economic order; ironically it also shows the
desirability of disconnecting monetary policy from political influence,
which is something else the neo-conservatives ignore when trumpeting
Friedman.

OK, back to real work, dammit!

DSK