AXEC: New Foundations of Economics: October 2024

October 15, 2024

Occasional Xs: The futile attempt to recycle Marx (XXXIV)

#Economics #FailedFakeScience

“Have Any of Karl Marx’s Critics Today Actually Read Him?” (Jacobin)

Have any of Karl Marx’s followers realized that his Profit Theory is provably false?

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism,…
— E.K-H (@AXECorg) October 15, 2024

Occasional Xs: Scrap the EconNobel (XXIX)

#Economics #FailedFakeScience #NobelPrize

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL… pic.twitter.com/m1d94IufGB
— E.K-H (@AXECorg) October 15, 2024

Occasional Xs: Economics still lacks correct macrofoundations (XXX)

#Economics #FailedFakeScience

“… continue our "RIP" series with a critique of the IS-LM (also known as the Hicks-Hansen) Model.”

IS-LM is proto-scientific garbage and it has already been buried in 2016.

Causa finita: the end of I=S/IS-LMhttps://t.co/jzrdUzGrtW
— E.K-H (@AXECorg) October 15, 2024

For more about IS-LM see AXECquery.

Occasional Xs: Scrap the EconNobel (XXVIII)

#Economics #FailedFakeScience #NobelPrize

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL… pic.twitter.com/nMcSV1tP1W
— E.K-H (@AXECorg) October 15, 2024

October 14, 2024

Occasional Xs: The futile attempt to recycle Keynesianism (LXI)

#Economics #FailedFakeScience

For 200+ years, economics has claimed to be #Science but still is NOT. #Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got… pic.twitter.com/jTG7g8pQJD
— E.K-H (@AXECorg) October 14, 2024

“Years ago I heard Mr. Cobden say at a League Meeting that ‘Political Economy was the highest study of the human mind, for that the physical sciences required by no means so hard an effort.’” (Bagehot, 1885)

This topos is the standard excuse when economists are confronted with the fact that, compared to genuine sciences, economics as a Cargo Cult (Feynman's term) has achieved virtually nothing in 200+ years.

Occasional Xs: Scrap the EconNobel (XXVII)

#Economics #FailedFakeScience

'The "Nobel prize" in economic sciences this year goes to Acemoglu/Johnson/Robinson "for studies of how institutions are formed and affect prosperity".'

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism,… pic.twitter.com/QersQlQpyu
— E.K-H (@AXECorg) October 14, 2024

Also at El-Erian.

For more about Institutions see AXECquery.

Occasional Xs: Scrap the EconNobel (XXVI)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/RK7OSZWUlU
— E.K-H (@AXECorg) October 14, 2024

Occasional Xs: Economics still lacks correct macrofoundations (XXIX)

#Economics #FailedFakeScience #MacroFoundations

Your graph Geldkreislauf is false/misleading. Here is the axiomatically correct elementary monetary circuit ⇓.

For details see

The monetary circuit and how economists got it wronghttps://t.co/eTHAF4vjr4

The GDP death blow for… pic.twitter.com/lI942EL15f
— E.K-H (@AXECorg) October 14, 2024

Occasional Xs: How it works (CCXLXXIV)

#HowItWorks

“Moving toward a centrally planned economy is doomed to failure. ” (Cato Institute)

The U.S. economy runs on #Profit. Macroeconomic profit is given by the axiomatically correct #ProfitLaw / #BalancesEquation (I−Sm)+(G−T)+(X−M)−(Qm−Yd)≐0. The Profit Law implies…
— E.K-H (@AXECorg) October 14, 2024

October 13, 2024

Occasional Xs: Clueless economists / Science (CXXII)

#Economics #FailedFakeScience #Methodology

“Hayek and Popper both make epistemological arguments for liberalism. Popper focuses on the fallibility of scientific knowledge and Hayek on dispersed and tacit knowledge.” (YK)

Later in his life, Popper ended up as a member of Hayek's…
— E.K-H (@AXECorg) October 13, 2024

Occasional Xs: The futile attempt to recycle Hayek (XXVII)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/vxK6ZrhsMB
— E.K-H (@AXECorg) October 13, 2024

Occasional Xs: The futile attempt to recycle Hayek (XXVI)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit…
— E.K-H (@AXECorg) October 13, 2024

October 12, 2024

Occasional Xs: How it works (CCXLXXIII)

#HowItWorks

“Government spending in all European countries has been going up, …” (Michael Arouet)

The #FreeMarketEconomy runs on #Profit. Macroeconomic profit Qm is given by the axiomatically correct #ProfitLaw / #BalancesEquation (I−Sm)+(G−T)+(X−M)−(Qm−Yd)≐0 (which…
— E.K-H (@AXECorg) October 12, 2024

Occasional Xs: The futile attempt to recycle Hayek (XXV)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit…
— E.K-H (@AXECorg) October 12, 2024

Occasional Xs: What economists really do (CCCLXIX)

#HowItWorks

“Immature modes of reasoning ― for example, bad people do bad things; good people do good things ― must be replaced by the more mature and disciplined reasoning of 'invisible hand' explanations.” (Peter Boettke)

No, the very task of #Science is to make the…
— E.K-H (@AXECorg) October 12, 2024

Occasional Xs: Scrap the EconNobel (XXV)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/E2Gc5b1lbh
— E.K-H (@AXECorg) October 12, 2024

Also at James Broughel

October 11, 2024

Occasional Xs: The foul spirit of political economics (XCV)

#Economics #GeoEconomics #GeoPolitics

The idea to turn off the gas tap (and thus create an artificial/inflationary #Scarcity) has been put forward by Mr. Habeck in the 2016 election campaign ⇓. He and the #ZeitenWende / #KillNordStream folks executed the plan after 2021. The… pic.twitter.com/xwVQjsCWbQ
— E.K-H (@AXECorg) October 11, 2024

Occasional Xs: What economists really do (CCCLXVIII)

#Economics #FailedFakeScience #Economists #StupidOrCorruptOrBoth

“Economists are freedom nuts, which is to say that they look with suspicion on lawyerly plans to solve problems with new state compulsions and longer jail sentences.” (Deirdre McCloskey)

If you thought that…
— E.K-H (@AXECorg) October 11, 2024

October 10, 2024

Occasional Xs: The futile attempt to recycle Hayek (XXIV)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit…
— E.K-H (@AXECorg) October 10, 2024

Occasional Xs: Clueless economists / Profit (L)

#HowItWorks

“There is a reason why US companies have higher valuations, they are more innovative and have better profit growth outlook.”

The U.S. #Economy runs on profit. Macroeconomic profit is given by the axiomatically correct #ProfitLaw / #BalancesEquation… pic.twitter.com/3gzoR4Wk4F
— E.K-H (@AXECorg) October 10, 2024

Occasional Xs: Clueless economists / Science (CXXI)

#Economics #FailedFakeScience

For a #Scientist, the decisive criterion is true/false with #Truth well-defined as material and formal consistency. Nothing is farther away from #Science than #Politics.

Economics claims to be #Science but is NOT. The major approaches… pic.twitter.com/Wf3Tl9rNiE
— E.K-H (@AXECorg) October 10, 2024

Occasional Xs: Scrap the EconNobel (XXIV)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/GBJLQXPdoG
— E.K-H (@AXECorg) October 10, 2024

Also at Tobias Blanken.

Occasional Xs: What economists really do (CCCLXVII)

#Economics #FailedFakeScience

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/qvnk1goWiD
— E.K-H (@AXECorg) October 10, 2024

Occasional Xs: The foul spirit of political economics (XCIV)

#Economics #FailedFakeScience #Economists #StupidOrCorruptOrBoth

“Economists are freedom nuts, which is to say that they look with suspicion on lawyerly plans to solve problems with new state compulsions and longer jail sentences.” (Deirdre McCloskey)

If you thought that… pic.twitter.com/YdEBnepMux
— E.K-H (@AXECorg) October 10, 2024

Occasional Xs: Scrap the EconNobel (XXIII)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/AKIinJX35A
— E.K-H (@AXECorg) October 10, 2024

October 9, 2024

Occasional Xs: The futile attempt to recycle Hayek (XXIII)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit…
— E.K-H (@AXECorg) October 9, 2024

Occasional Xs: Scrap the EconNobel (XXII)

#Economics #FailedFakeScience #NobelPrize

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL…
— E.K-H (@AXECorg) October 9, 2024

Occasional Xs: How it works (CCXLXXII)

#HowItWorks

“We manufacture the appearance of growth through inflation...are we actually growing this economy, or is it just fluff, in terms of inflated dollars?” (Chris Whalen)

The U.S. #Economy runs on #Profit. Macroeconomic profit Qm is given by the axiomatically correct… pic.twitter.com/W1qbd4E2qw
— E.K-H (@AXECorg) October 9, 2024

Occasional Xs: The foul spirit of political economics (XCIV)

#Economics #FailedFakeScience

“Less Marx, more Milei” (Libertarian)

No, neither Marx nor Milei!

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory &… pic.twitter.com/b9GVEmCaU0
— E.K-H (@AXECorg) October 9, 2024

Occasional Xs: What economists really do (CCCLXVI)

#Economics #FailedFakeScience

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/ry2KO8kdpP
— E.K-H (@AXECorg) October 9, 2024

October 8, 2024

Occasional Xs: The futile attempt to recycle behavioral economics (VI)

#Economics #FailedFakeScience #PsySoc

Economics is about how the #Economy works. It is a #SystemsScience and NOT a #SocialScience. #Economists have messed it up since the founding fathers.

The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their…
— E.K-H (@AXECorg) October 8, 2024

Occasional Xs: How it works (CCXLXXI)

#HowItWorks #DebtBrake #SchuldenBremse

The #FreeMarketEconomy runs on #Profit. Macroeconomic profit Qm is given by the axiomatically correct #ProfitLaw / #BalancesEquation (I−Sm)+(G−T)+(X−M)−(Qm−Yd)≐0 (which consists of variables measurable with an accuracy of two decimal… pic.twitter.com/hMXppAMYAJ
— E.K-H (@AXECorg) October 8, 2024

Occasional Xs: Scrap the EconNobel (XXI)

#Economics #FailedFakeScience #NobelPrize

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL…
— E.K-H (@AXECorg) October 8, 2024

Occasional Xs: Scrap the EconNobel (XX)

#Economics #FailedFakeScience #NobelPrize

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL…
— E.K-H (@AXECorg) October 8, 2024

Occasional Xs: Scrap the EconNobel (XIX)

#Economics #FailedFakeScience #NobelPrize

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL… pic.twitter.com/J1QZRJHd0y
— E.K-H (@AXECorg) October 8, 2024

Occasional Xs: What economists really do (CCCLXV)

#Economics #FailedFakeScience #EconTwitter

“Wie Ökonomen unsere Wirtschaft ruinieren …” / “How economists are ruining our economy …”

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their… pic.twitter.com/Via78W92hE
— E.K-H (@AXECorg) October 8, 2024

Occasional Xs: Clueless economists / Market (II)

#Economics #FailedFakeScience #PriceMechanism

It’s important to realize that the #FreeMarketSystem is in the last instance a quasi-Darwinian selection mechanism, i.e., the economic analog to #Triage in medicine.

For example, during a famine, only the rich person can pay the…
— E.K-H (@AXECorg) October 8, 2024

Also at Students for Liberty.

Also at Jason Sorens.

***

Twitter/X, Oct 7, 2024 Another example

Occasional Xs: Clueless economists / Science (CXX)

#Economics #FailedFakeScience

“You don’t need to empirically test what is known to be logically, irrefutably true…”

This is, in one sentence, the manifest methodological imbecility that is the representative economist's hallmark.#Science is well-defined: “Research is in fact…
— E.K-H (@AXECorg) October 8, 2024

For more about methodology see AXECquery.

October 7, 2024

Occasional Xs: The foul spirit of political economics (XCIII)

#Economics #FailedFakeScience

"Jacob Viner, [...], had famously said that the task of economists was to expose fallacies in the arguments of politicians …”

No, the task of economists is to get rid of their own fallacies and finally find out how the economy works.

The history… pic.twitter.com/86JWH7rGNW
— E.K-H (@AXECorg) October 7, 2024

Occasional Xs: How it works (CCXLXX)

#HowItWorks #LearnRealEcon

“When I say the system is rigged for the rich, this is what I mean.” (Robert Reich)

The U.S. #Economy runs on #Profit. Macroeconomic profit Qm is given by the axiomatically correct #ProfitLaw / #BalancesEquation (I−Sm)+(G−T)+(X−M)−(Qm−Yd)≐0…
— E.K-H (@AXECorg) October 7, 2024

Occasional Xs: Clueless economists / Science (CXIX)

#Economics #FailedFakeScience #Economists #StupidOrCorruptOrBoth

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false &… pic.twitter.com/V3VqhHgqA4
— E.K-H (@AXECorg) October 7, 2024

Occasional Xs: How it works (CCXLXIX)

#HowItWorks

“Over the past two years, Fed transferred $3k from every single American to the big banks.” (Matt Stoller)

The U.S. economy runs on #Profit. Macroeconomic profit is given by the axiomatically correct #ProfitLaw / #BalancesEquation (I−Sm)+(G−T)+(X−M)−(Qm−Yd)≐0.…
— E.K-H (@AXECorg) October 7, 2024

Occasional Xs: The role of narratives and storytelling in economics (IV)

#Economics #FailedFakeScience #DisInfoTainment

The history of economic thought is the history of scientific failure. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false &…
— E.K-H (@AXECorg) October 7, 2024

October 6, 2024

Occasional Xs: Paradigm Shift (XXXVIII)

#Economics #FailedFakeScience #Economists #StupidOrCorruptOrBoth

“The Economy Is at a Hinge Moment”

The history of economic thought is the history of scientific failure. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are… pic.twitter.com/ygg3qpc45r
— E.K-H (@AXECorg) October 6, 2024

Occasional Tweets: Time to get the axioms of economics right (II)

#Economics #FailedFakeScience #MicroFoundations #MacroFoundations

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false &… pic.twitter.com/KhrS5csuyP
— E.K-H (@AXECorg) October 6, 2024

For more about foundational equations see AXECquery.

October 5, 2024

Occasional Xs: The futile attempt to recycle MMT (CXX)

#Economics #FailedFakeScience #MMT

MMT's foundational #BalancesEquation is provably false, so their whole #Macroeconomics is scientifically worthless. ⇒

The page where Stephanie Kelton gets macroeconomics wrong https://t.co/CNFDkXM1Ki

The axiomatically correct…
— E.K-H (@AXECorg) October 5, 2024

October 4, 2024

Occasional Xs: Clueless economists / Employment (XIII)

#Economics #Employment

“We've created almost 7 million jobs since before the pandemic.” (Marc Goldwein)

The axiomatically correct macroeconomic #EmploymentLaw ⇓ shows that #Employment L increases if the avg #WageRate W rises faster than the avg product #Price P or if the… pic.twitter.com/o2zCoJtUlp
— E.K-H (@AXECorg) October 4, 2024

Occasional Xs: What economists really do (CCCLXIV)

#Economics #FailedFakeScience

The history of economic thought is the history of scientific failure. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally… pic.twitter.com/7Q1pJgAOvj
— E.K-H (@AXECorg) October 4, 2024

Occasional Xs: Scrap the EconNobel (XVIII)

#Economics #FailedFakeScience #NobelPrize

Economics claims to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL… pic.twitter.com/WhwQqDWPdD
— E.K-H (@AXECorg) October 4, 2024

Occasional Xs: What economists really do (CCCLXIII)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/vISes7Zub6
— E.K-H (@AXECorg) October 4, 2024

Also at David Andolfatto.

Occasional Xs: The futile attempt to recycle Marx (XXXIII)

#Economics #FailedFakeScience #HallOfShame

Marx NEVER understood what #Profit is and how the economic #System works. That's rather bad for an economist.

Karl Marx, fake scientisthttps://t.co/1E0x5HYg0X
— E.K-H (@AXECorg) October 4, 2024

Occasional Xs: How it works (CCXLXVIII)

#LearnEconomics #BreakDown

“Extreme government spending is driving our country to bankruptcy!” (Elon Musk)

But only AFTER the election!

The U.S. #Economy runs on profit. Macroeconomic profit Qm is given by the axiomatically correct #ProfitLaw / #BalancesEquation…
— E.K-H (@AXECorg) October 4, 2024

October 3, 2024

Occasional Xs: What economists really do (CCCLXII)

#Economics #FailedFakeScience

For 200+ years, economics has claimed to be #Science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally… pic.twitter.com/7wpqOfuq2f
— E.K-H (@AXECorg) October 3, 2024

Occasional Xs: Clueless economists / Science (CXVIII)

#Economics #HallOfShame

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit wrong.…
— E.K-H (@AXECorg) October 3, 2024

Occasional Xs: Clueless economists / Breakdown (VI)

#HowItWorks #BreakDown

“America is headed for bankruptcy.” (Elon Musk)

The U.S. #Economy runs on profit. Macroeconomic profit Qm is given by the axiomatically correct #ProfitLaw / #BalancesEquation (I−Sm)+(G−T)+(X−M)−(Qm−Yd)≐0 (which consists of variables measurable with…
— E.K-H (@AXECorg) October 3, 2024

Related 'Profit analysis ― another exercise in economic deception'.

Occasional Xs: How it works (CCXLXVII)

#HowItWorks

“We're really lucky for the Fed's nonpartisanship.” (Jason Furman)

The U.S. economy runs on #Profit. Macroeconomic profit is given by the axiomatically correct #ProfitLaw / #BalancesEquation (I−Sm)+(G−T)+(X−M)−(Qm−Yd)≐0. The Profit Law implies…
— E.K-H (@AXECorg) October 3, 2024

Occasional Xs: What economists really do (CCCLXI)

#Economics #FailedFakeScience #EconTwitter

“Economists didn't just make a few mistakes, economics is fundamentally rotten and corrupt.” (Matt Stoller)

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and… pic.twitter.com/2t7WJ2uE4X
— E.K-H (@AXECorg) October 3, 2024

October 2, 2024

Occasional Xs: Clueless economists / Profit (XLIX)

#Economics #FailedFakeScience #Profit #StolenValue

“Entrepreneurial profit is the expression of the value of what the entrepreneur contributes to production.” (Schumpeter)

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism,… pic.twitter.com/4WL5Lk0TaW
— E.K-H (@AXECorg) October 2, 2024

Occasional Xs: Economics still lacks correct macrofoundations (XXVIII)

#Economics #FailedFakeScience

“Everyone wrongly bases policy on Y = C + I + X - M + G when they should instead base policy on Y = AL¹⁻ᵅKᵅ.” (Eli Dourado)

No, economics must be based on #MacroFoundations. ⇓

Economics claims to be #Science but NEVER rose about the level of… pic.twitter.com/yXMd78Wsrs
— E.K-H (@AXECorg) October 2, 2024

October 1, 2024

Occasional Xs: The futile attempt to recycle MMT (CXIX)

#Economics #FailedFakeScience #MMT

“… 'The Deficit Myth' has been featured in BookAuthority's list of best Money books of all time!”

MMT's foundational #BalancesEquation is provably false, so their whole #Macroeconomics is scientifically worthless. ⇒

The page where Stephanie…
— E.K-H (@AXECorg) October 1, 2024

Occasional Xs: The Profit Law holds for Capitalism and Communism and everything in-between (II)

#Economics #Capitalism #Communism

In the monetary economy holds: macroeconomic profit Qm is given by the axiomatically correct #ProfitLaw / #BalancesEquation (I−Sm)+(G−T)+(X−M)−(Qm−Yd)≐0 (which consists of variables that can be measured with the accuracy of two decimal…
— E.K-H (@AXECorg) October 1, 2024

Occasional Xs: How it works (CCXLXVI)

#Economics #HowItWorks

The correct term for the U.S. polity is NOT #Democracy but #Oligarchy or in Newspeak "constitutional presidential federal democratic republic".

The #FreeMarketEconomy a.k.a. #Capitalism runs on #Profit. Macroeconomic profit is given by the axiomatically…
— E.K-H (@AXECorg) October 1, 2024

Occasional Xs: What economists really do (CCCLX)

#Economics #FailedFakeScience

“Ohne Schulden hat noch niemand eine Eisenbahn gebaut” (Philippa Sigl-Glöckner, Ökonomin)

True, but entirely beside the point. Ms. Sigl-Glöckner plays a silly mind game by confusing the debt-financing of infrastructure and the debt-financing of…
— E.K-H (@AXECorg) October 1, 2024

Also at Christian Breuer.

Occasional Xs: How it works (CCXLXV)

#Economics #FailedFakeScience #PriceMechanism

“It’s important to remember that 'price gouging' both incentivizes suppliers to provide more to meet the high demand and incentivizes consumers to conserve what they have for its highest valued uses.” (Chris Freiman)

It’s important…
— E.K-H (@AXECorg) October 1, 2024

Also at Hannah Cox.

Also at Libertarian Party of Tennessee

Occasional Xs: Scrap the EconNobel (XVII)

#Economics #FailedFakeScience

Economics claims to be science but is NOT. The major approaches (#Walrasianism, #Keynesianism, #Marxianism, #Austrianism, and their derivatives) are mutually contradictory & axiomatically false & materially/formally inconsistent & ALL got #Profit… pic.twitter.com/sqkwPxMhtE
— E.K-H (@AXECorg) October 1, 2024

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Knowledge only — no opinion

Science does not explain everything, but non-science explains nothing.

Neither orthodox nor heterodox economics satisfies the scientific criteria of material and formal consistency.

Economists cannot explain how the economy works. The Profit Theory is false since Adam Smith. There is much opinion and little knowledge.

Opinion is the realm of political economics, knowledge is the realm of theoretical economics.

Political economics is scientifically worthless.

Theoretical economics is built upon clearly stated premises, i.e., upon a set of axioms.

Orthodoxy got the axiomatic foundations wrong and Heterodoxy has none at all.

Economics is a failed science. Economists are incompetent scientists.

Profit

Neither Classicals, nor Walrasians, nor Marshallians, nor Marxians, nor Keynesians, nor Institutionialists, nor Monetary Economists, nor MMTers, nor Austrians, nor Sraffaians, nor Evolutionists, nor Game theorists, nor EconoPhysicists, nor RBCers, nor New Keynesians, nor New Classicals ever came to grips with profit. Hence, they all fail to capture the essence of the market economy.

Because of this, economists have nothing to offer in the way of a scientifically founded economic policy guidance.

The hybrid science

As a first approximation, one can agree on the general characteristic that the economy is a complex system.

However, with the term system one usually associates a structure with components that are non-human. In order to stress the obvious fact that humans are an essential component of the economic system the market economy should be characterized more precisely as a complex hybrid human/system entity.

The scientific method is straightforwardly applicable to the sys-component but not to the hum-component. While it is clear that the economy always has to be treated as an indivisible whole, for good methodological reasons the analysis has to start with the objective system-component.

In gestalt-psychological terms the economic system is the foreground, individual behavior the background. Common sense wrongly insists that the hum-component must always be in the foreground. This fallacy compares to geo-centrism. The economic system has its own logic which is different from the behavioral logic of humans. The systemic logic is what Adam Smith called the Invisible Hand.

There are systemic laws but no behavioral laws. Systemic laws have the same methodological status as physical laws.

Neither Orthodoxy nor Heterodoxy can tell what the systemic laws of the actual monetary economy are.

Whether the outcome of the human/system-interaction is good or bad is a politcal question that lies outside of theoretical economics. Theoretical economics explains how the actual economy works - no less, no more.

Narrative vs.Theory

Psychological, sociological or behavioral assumptionism cannot yield anything other than a gossip model of the world. Second-guessing the agents is not economic analysis.

Science deals exclusively with propositions that can in principle be decided by objective means. The rest is opinion, faith, phantasy, motive speculation, allegation, hallucination, myth, paranoia, ink-blot association, psychology, philosophy, in one word: storytelling.

Storytelling is the original mode of communication in the social realm — except science.

Political economics is storytelling and, by default, the natural habitat of confused confusers. Walrasianism, Keynesianism, Marxianism, Austrianism are social narratives and not scientifically valid representations of reality.

"The truth is, most persons, not excepting professional economists, are satisfied with very hazy notions." (Fisher)

In marked contrast, theoretical economics lives up to the standards of material and formal consistency. A scientific theory is the best mental representation of reality that is humanly possible.

Theory starts with a set of objective and consistent axioms.

Paradigm Shift

"The problem is not just to say that something might be wrong, but to replace it by something — and that is not so easy." (Feynman)

"As will become evident, there is more agreement on the defects of orthodox theory than there is on what theory is to replace it: but all agreed that the point of the criticism is to clear the ground for construction." (Nell)

"The moral of the story is simply this: it takes a new theory, and not just the destructive exposure of assumptions or the collection of new facts, to beat an old theory." (Blaug)

"Is it not a fact, which stares at us from the histories of all sciences, that it is much more difficult for the human mind to forge the most elementary conceptual schemes than it is to elaborate the most complicated superstructure when those elements are well in hand?" (Schumpeter)

"The task of producing knowledge against the grain requires imagination." (Mirowski)

"A new idea is extremely difficult to think of. It takes a fantastic imagination." (Feynman)

"The scientific imagination dreams of explanations and laws." (Peirce)

"It is brilliance of imagination which makes the glory of science." (Evans)

"... we know little more now about ‘how the economy works,’ ... than we knew in 1790, after Adam Smith completed the last revision of The Wealth of Nations." (Clower)

Selftest and to watch for

You apply one of these items

• supply-demand-equilibrium,

• general equilibrium,

• marginal utility,

• well-behaved production functions,

• total income = value of output,

• total income = wages + profits,

• I=S,

• wage rate down - employment up,

• behavioral axioms?

Then you are out of science because of unnoticed material or formal inconsistency.

Every economist who uses the concept of equilibrium is scientifically incompetent because she/he failed to notice that equilibrium is an economic nonentity.

Practically this means: as soon as the word equilibrium appears in an economic text it can be thrown into the waste basket. The same holds for all other nonentities.

The vast majority of economists deals mainly with nonentities. This is why Walrasianism, Keynesianism, Marxianism, Austrianism is scientifically worthless.

Since Adam Smith, economic policy guidance has no sound scientific foundations.

To be replaced (1)

The core premises of Orthodoxy are uncertain and false and this fully explains the failure of the research program.

“As with any Lakatosian research program, the neo-Walrasian program is characterized by its hard core, heuristics, and protective belts. Without asserting that the following characterization is definitive, I have argued that the program is organized around the following propositions: HC1 economic agents have preferences over outcomes; HC2 agents individually optimize subject to constraints; HC3 agent choice is manifest in interrelated markets; HC4 agents have full relevant knowledge; HC5 observable outcomes are coordinated, and must be discussed with reference to equilibrium states.” (Weintraub)

The inescapable Paradigm Shift consists of the move from this obsolete hard core to the superior set of structural axioms.

To be replaced (2)

The fundamental equations of macroeconomics have been formulated by Keynes in two lines.

"Income = value of output = consumption + investment. Saving = income - consumption. Therefore saving = investment."

This elementary syllogism is demonstrably false. The demonstration consists in the proof that Keynes could not solve the Profit Puzzle. Neither did Post-Neo-New-Keynesians.

In the most general terms, the economics Paradigm Shift consists in switching from the behavior-centric bottom-up approach to the structure-centric top-down approach. This is comparable to the Copernican turn from geo-centrism to helio-centrism.

Consensus

Economics is a science without scientists. Because they are ignorant of the elementary difference between profit and income, the present generation of economists has not made and cannot make a significant contribution to the discussion about how the actual economy works.

Every orthodox or heterodox economist can convince himself/herself that their profit theory is defective.

Every non-economist can — by applying elementary logic — convince himself that conventional profit theories are false. See 'How the intelligent non-economist can refute every economist hands down'.

Because the profit theory is false the whole of conventional economic theory has to be rejected.

"What is now taught as standard economic theory will eventually disappear, no trace of it will remain in the universities or boardrooms because it simply doesn’t work: were it engineering, the bridge would collapse." (McCauley)

No scientist will ever accept Walrasianism, Keynesianism, Marxianism, or Austrianism. These approaches are logically and/or empirically refuted. This is the actual methodological state-of-art. Walrasians, Keynesians, Marxians, or Austrians are still at the proto-scientific stage. These approaches cannot be improved, only abandoned.

Economists are a public nuisance because they have an opinion on everything but knowledge of nothing.

About me

“Bottom line is that your profit law is just a definition you made up nobody else agrees with, nobody. You are all alone with your precious tautology.” Barkley Rosser

“In any event, your entire theory is based on you doing macro accounting in wacky fashion that nobody agrees with.” Brian Romanchuk

"Your stuff is at least original: it's quite cool after a couple of decades at this to see a fresh Economics. But real promises are not advanced: they were around for millennia until the Greeks obscured them with Metaphysics." Chris Cook

"No mate, they're you-blockers. You have all the personality traits of a crank, and the rest of them have tired of you. You could be 100% right, and you'd still die as your only follower." Steve Keen

"What you are doing fills is all with joy, your constructive critique is most welcome!"

Achim Truger,

German Council of Economic Experts,

in a failed attempt to be ironic

"200+ years of thought and yet you are the only one who gets it—or even understands your argument. Thank god we have you, pseudonymous Twitter user. Otherwise no one would know."

William Luther

Assistant Professor of Economics

in a failed attempt to be funny

"Egmonts profit law is the perfect equation that demonstrates this in action. Put the equation into a spreadsheet and then add government spending and watch how it flows into profits. Enter in some debt (-Sm) and watch too how that flows into profits. It can't go anywhere else."

Dean

About the rest of economics

Walrasianism, Keynesianism, Marxianism, Austrianism, MMT, Pluralism are mutually contradictory, axiomatically false, materially/ formally inconsistent. Economics is a failed science.

“There are three classes of people: those who see. Those who see when they are shown. Those who do not see.” Leonardo da Vinci

In economics, the overwhelming majority belongs to Class III. This explains why economics is after 200+ years still at the proto-scientific level.

The obvious task for every economist is to advance from cargo cult science and political agenda-pushing to science. This is absolutely beyond the means of Class III people.

For 200+ years now, economists are not scientists but agenda pushers, useful idiots, clowns in the political Circus Maximus.

Nopopop

This blog does not add to any popular/un- popular opinion.

This blog does not hand out advice about how to avoid taxes, to get rich on the stock market, to be successful in business, to increase the wealth of nations, to run an economy, to maximize welfare, to prevent national/global bankruptcy, to improve the institutional setup of society, to get out of national/global depression, nor about how to save humankind or any subgroup thereof.

This blog is about the true theory of the actual monetary economy.

"In order to tell the politicians and practitioners something about causes and best means, the economist needs the true theory or else he has not much more to offer than educated common sense or his personal opinion." (Stigum)

Focus

Science is of primary interest and importance. Scientists are of secondary interest.

With regard to science, most people lose focus easily because of a natural preference for anecdotes and gossip over facts or subjectivity over objectivity.

Hence, Schumpeter once considered it necessary to remind his habitually disoriented fellow economists: “Remember: occasionally, it may be an interesting question to ask why a man says what he says; but whatever the answer, it does not tell us anything about whether what he says is true or false.”

Science is about true/false and nothing else.

Disclaimer

Missing Blog-Reference links: AXEC does not guarantee that their comments can at any time be recovered from where they have been posted intitially because the availability depends on the publication policy of the blog owner which is implicitly accepted on entering a debate. See also: 'Economists: Incompetent? Stupid? Corrupt?'

Texts: Parts of arbitrary length of any of the author's texts is and will be used again by the author in papers, books, websites, blogs, and other media without explicit reference. The right to make corrections or minor textual improvements on reutilization is reserved. Therefore, it is always a good idea to double-check for the latest version.

Caution: Do not expect a corroboration of your political view. Neither a refutation. Political economics has been scientifically worthless since Adam Smith. Politics has to be separated from economics because it is categorically different from science. The best science can do and has always done is to prove beyond reasonable doubt that you have been objectively wrong or ignorant until now. Science goes beyond the naive common sense of today and becomes the sophisticated common sense of tomorrow.

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Outlook

To recall, while political economics is storytelling, theoretical economics adheres to scientific standards.

The first task of theoretical economics is to get the axiomatic foundations right. This is what J. S. Mill called the opus magnum. Neither Orthodoxy nor Heterodoxy came up with a reasonable solution to this day. This explains the secular stagnation of economics.

There is no serious alternative to structural axiomatic economics. This is not a matter of opinion but of proof. The sole criteria are material and formal consistency.

All of economics has to be reconstructed from the ground up.

Major economic policy implication

The price mechanism does not work as standard economics hypothesizes. The axiom-based Employment Law states that overall employment increases if the average wage rate increases relative to average price and productivity. This gives one the lever to improve the employment situation all over the world and to fend off deflation without rising debt and without artificial capacity growth. To increase the average price relative to the average wage rate and productivity increases unemployment.

Right policy depends on true theory.

“In order to tell the politicians and practitioners something about causes and best means, the economist needs the true theory or else he has not much more to offer than educated common sense or his personal opinion.” (Stigum)

Lacking the true theory, economists promote for more than 200 years opinion instead of knowledge.