INVISIBLE HANDS AND ZOMBIES
James Mackintosh posts (15 September) on Wall Sreet Journal HERE
“Zombies May Be Prowling The Stock Market”
“Well, yes: Part of the point is to discourage saving and encourage consumption. More coherent critics worry that low rates damage the economy by sustaining companies and banks which ought to be driven out of business in a zombie state, so limiting the recycling of capital back to more deserving, faster-growing companies. The fear is that the creative destruction identified as vital to capitalism by the late Joseph Schumpeter has been put on hold. …
“… Individual investors may not care too much, particularly those who made almost 17% on utilities over the past year. But if the invisible hand of the market is suffering from zombie putrefaction, the economy will be less dynamic than usual.”
Lamenting the non-existence of a “supposed invisible hand”, usually miscredited to Adam Smith, a wholly innocent man, until libelled by Paul Samuelson in 1948, the spin masters have found another culprit , imaginary “zombies”.
Political economy once had claims to be a science….